something to teach, something to learn. dr mark britnell chairman and partner global health practice...

Something to Teach, Something to Learn.

Dr Mark BritnellChairman and Partner Global Health Practice KPMG

2© 2013 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG International’), a Swiss entity. All rights reserved. This document is confidential and its circulation is restricted. KPMG and the KPMG logo are registered trademarks of KPMG International Cooperative, a Swiss entity.

Mark Britnell – 60 countries, 167 occasions.

World Economic Forum, Davos 2012: “The financing of health systems

has increasingly burdened developed economies, which has

been exacerbated by the fiscal crisis. Participants agreed on the drivers of the expenditure growth and, since many of these factors

are unlikely to recede (e.g. ageing, lifestyles, public expectations),

there is a clear need to develop a more sustainable way of

managing health systems. The magnitude of health financing

challenges suggests that incremental solutions may not be enough; however, a shared vision of new models for health systems

does not yet exist.”

Source: The Great Transformation: Shaping New Models – World Economic Forum Annual Meeting Davos 2012

4© 2013 KPMG Advisory N.V., ingeschreven bij het handelsregister in Nederland onder nummer 33263682, is een dochtermaatschappij van KPMG Europe LLP en lid van het KPMG-netwerk van zelfstandige ondernemingen die verbonden zijn aan KPMG International Cooperative (‘KPMG International’), een Zwitserse entiteit. Alle rechten voorbehouden. Gedrukt in Nederland. De naam KPMG, het logo en ‘cutting through complexity’ zijn geregistreerde merken van KPMG International.

Changing business operations to realize cost efficiencies

Improving cash and working capital management

Exploiting growth opportunities through successful transactions

Preparing your organization for major business model changes

Managing and retaining the right people within the organization

Addressing risk throughout the organization

Looking for growth in emerging markets

Innovation through product development

Adapting to take into account changing customer and stakeholder behavior

Using information to forecast response to uncertain times

Refinancing or seeking capital

Using technology as a strategic enabler, not just an operational facilitator

Embedding sustainability in the business model

Responding to regulatory change

Seizing opportunities offered by increasing public/private sector interaction

43%

32%

30%

25%

24%

21%

21%

20%

18%

15%

13%

12%

10%

10%

6%

KPMG research: Transaction trumps transformation.

Note: (a) Due to rounding up and down total figure may vary from 300%

Source: KPMG ‘Succeeding in a Changing World’ 2012

Total adds up to 300% all respondents had three votes(a)

3,000 CEOs from all industries see the importance of transformational change but focus their attention on short term transactional efficiency.


27%

50%

15%

33%

15%

18%

18%

17%

20%

10%

12%

27%

17%

17%

5%

32%

43%

21%

30%

15%

25%

4%

21%

18%

12%

10%

24%

13%

20%

10%

Total Healthcare

Healthcare leaders are even more focused on the urgent issues of today and less on the important ones of tomorrow.

Note: (a) Due to rounding up and down total figure may vary from 300%

Source: KPMG ‘Succeeding in a Changing World’ 2012

Total adds up to 300% all respondents had three votes(a)

Healthcare

Improving cash and working capital management

Changing business operations to realize cost efficiencies

Addressing risk throughout the organization

Exploiting growth opportunities through successful transactions

Using information to forecast response to uncertain times

Preparing your organization for major business model changes

Seizing opportunities offered by increasing public/private sector interaction

Looking for growth in emerging markets

Adapting to take into account changing customer and stakeholder behavior

Using technology as a strategic enabler, not just an operational facilitator

Embedding sustainability in the business model

Managing and retaining the right people within the organization

Refinancing or seeking capital

Innovation through product development

Responding to regulatory change


KPMG in Rome, 2012. Over 40 senior executives and clinicians from 22 countries debated major global challenges of today.

Frances DiverExecutive Director, Victorian Department of Health

Chris RexCEO, Ramsay Health Care

Dr. Claudio Luiz LottenbergChairman & President, Hospital Israelita Albert Einstein

Prof. Axel EkkernkampCEO, Unfallkrankenhaus, Berlin

Glenna RaymondPresident and CEO Ontario Shores Centre for Mental Health Sciences

Dr. Kevin SmithPresident and CEO, St. Joseph's Health System

Prof. Shan WangCEO, Peking University Peoples Hospital

Christian BoelVice Healthcare President in Region Midtjylland

Filippo Monteleone Managing Director, General de Santé

Prof. Dr. Udo JanssenChairman, German Hospital Institute

Prof. Anupam SibalMedical Director, Apollo Hospital

Dr. Terry McWadeDeputy CEO, Royal College of Surgeons in Ireland

Carlo PerucciHead of the National Outcomes Programme, National Healthcare Agency

Dr. Giancarlo RuscittiCEO Fondazione "Opera San Camillo"

Paolo Rolleri Director General IRCCS San Raffaele Pisana – Istituto di Ricovero e Cura a Carattere Scientifico

Dr. Masami SakoiPlanning Policy Director, Ministry of Health, Labour and Welfare

Dr. Chul LeeCEO, Yonsei University Health System

Prof. Dr. Hans BüllerCEO, Erasmus Medical Centre

Prof. Dr. Bastiaan BloemMedical Director, Radboud University Nijmegen Medical Center

Dr. Pieter Hasekamp CEO, Dutch Health Insurers Association (ZN)

Unni HembrePresident, European Federation of Nurses Associations (EFN)

Isabel VazCEO, Espírito Santo Saúde

Bala KrishnanDirector of Development Office of Chairman, Aspetar Scientific Advisory Board

Orsida GjebreaSenior Policy Advisor, Supreme Council of Health

Prof. Benjamin OngCEO, National University Health System

Dr Brian RuffHead of Risk Intelligence and Access Innovating Divisions, Discovery health

Martin GerberCFO, Universitätsspital Basel

Dr. Jennifer DixonDirector, Nuffield Trust

Sir Ian CarruthersCEO, NHS South of England

Sir Jonathan MichaelCEO, Oxford University Hospitals NHS trust

Sir Robert NaylorCEO, University College London Hospitals NHS Foundation Trust

Valerie MichieGlobal Head of Health, SERCO

Tim HarfordSenior Columnist at the FT and Author of Adapt: Why Success Always Starts with Failure

Sir Bruce KeoghMedical Director of the NHS and NHS Commissioning Board

Gary KaplanCEO, Virginia Mason Medical Center

Dr. Arthur SouthamExecutive Vice President, Kaiser Permanente

Ron WilliamsFormer Chair & CEO of Aetna Inc. and member of President Obama’s Management Advisory Board

Anne McElvoyPublic Policy Editor, The Economist

Paul Cummings Director of Finance, Northern Ireland Health and Social Care Board

Lord Nigel Crisp

Independent Crossbench Member of the House of Lords


European views

Growing vacancy rates across countries

Skills gaps emerging

Cost cutting very short term

Medical models of care changing slowly

Need to stop ‘boom and bust’ workforce planning


The paradox.

Most people believe that their health sectors need substantial change but think their own organisational plans are robust.

They can’t all be right. Transformational changes requires the majority to have a new vision. That's why change is hard.

Focus remains on transactional change not transformational reforms.

Leading hospitals, health plans and life sciences executives believe their

business models are ‘somewhat sustainable’

Source: Transforming Healthcare: From Volume to Value – New Research on Emerging Business Models KPMG 2012

HC Systems (104) Health Plans (51) Pharma (54)

8% 8%17%

25% 20%19%

40% 53% 43%

18%18% 20%

9%2% 2%

Not very sustainableSomewhat sustainableVery sustainableExtremely sustainableNot sure

Sustainability of current business models over next 5 years:

From volume to value (USA):

But they don’t feel their industries will stay the same…

…with moderate to major change coming in their

sectors

HC Systems (104) Health Plans (51) Pharma (54)

65%

41%24%

33%

53%

63%

2% 4%13%

Moderate changesMajor changesNot sure

Extent of changes to your industry over next 5 years:

Source: Transforming Healthcare: From Volume to Value – New Research on Emerging Business Models KPMG 2012


Healthcare leaders in Rome also demonstrate the paradox.

‘Most (75%) think that current business models are somewhat sustainable but almost all (95%) expect moderate (30%) or major (65%) business model change in the sector’

Question – The current business models operated by hospitals are:

Somewhat sustainable

Question – How much change do you expect to see in the shape of the

provider system and in their business models in the next 5 years?

Major changes

Source: Pre-conference survey Something to teach, Something to learn, KPMG Rome 2012


Active strategies to manage are transactional.

Question – Which strategies are

providers likely to adopt to respond to

these changes?

Major cost reduction

Lean and improvement methods

More focus and specialisation

Investment in Health IT

New workforce models

Extra income from existing payers

85%

81%

82%

78%

74%

44%



…..but they expect payment systems to focus more on quality, value and risk.

Question – I expect payment systems to:

Become more integrated

Contain more quality incentives

Focus more on patient value

Share more risk with providers

Reduce prices & cap volumes

Remain largely the same

78%

78%

74%

74%

55%

11%


They do believe integrated care will..

Source: Pre-conference survey Something to teach, something to learn, KPMG Rome 2012

…offer new possibilities for quality and cost

Reduce costs

(75%)

Improve outcomes (90%)


Consensus on major trends.

Payers are becoming ‘activist’.

Some hospitals are transforming into health systems.

Patients becoming active partners.

High growth health systems, providing new perspectives on health reform.

Innovative integration and partnership.

1

2

3

4

5


Passive funder to activist payer.

Make the organisation capable of contracting for outcomes and value.

Find new ways to connect with – and empower – patients.

Increase focus on the management of overall population health, ‘moving care upstream’.

Information, segmentation and stratification.

Delivery must be integrated and coordinated.

Payment reform is key; from volume to value.

Preperation of the programme: Getting acquinted

Data collection and GAP analyses

Exploring and developing scenarios

Example, The Friesland Health Insurer:

‘Provide the right care at the right place at the right time, now and in the future’

In the Netherlands health insurer De Friesland Zorgverzekeraar (DFZ) has developed a series of agreed outcome-based ‘care plan’ pathways

which are already delivering results.

Phase 1May – July 2011

Phase 2July – November 2011

Phase 3December 2011 – June 2012

Phase 4 & 5July 2012 – February 2013

Business cases (regional level & multi annual budget per hospital)

Decision making

Conditions from governance perspective

Nr Expert group From To

1 ER/IC Four ER/IC One regional ER/IC and two ER/IC with basic facilities

2 Birth care Five locations Tentative four locations

3 Oncology Five locations One location for complex oncology

4 Complex vascular care Five locations One location for complex surgery

5 Elective care Five locations One focused factory*

6 Chronic care Primary care & five hospital locations

Development of integrated care, self-management, implementation of E-health and electronic patient record

7 Elderly care Primary care & five hospital locations

Implementation of best practices; case manager, prevention, end of life care


Providers: Transact or transform?

In spite of fiscal crisis, many providers are still healthy and solvent. Uneven momentum for change.

All face big strategic question – ‘do things better or do better things?’

Much to be done operationally: Lean, workforce, care system re-design, clinical informatics and quality improvement at scale e.g.

Intermountain, Virginia Mason, Buurtzorg, Salford.

Some hospitals are transforming into ‘health systems’ through integration or acquisition e.g. Geisinger, Apollo,Saskatchewan (Canada), Albert Einstein, Brazil.

Some become narrow and focus using Lean, e.g. Aravind, Narayana Hrudayalaya, Fortis and Coxa in Finland.

For some M&A and new international markets offer growth e.g. Ramsay, Fortis, SECOM, Netcare.


21st century healthcare is a chaotic combination of 20th century acute care and 19th century general practice.

Competing and conflicting business and care models destroy value.

Some hospitals are beginning to understand they need to change their value proposition and integrate.

■ A clearly defined population

■ The ability to do reliable risk stratification and develop registries

■ Accountability for outcomes, supported by aligned contracts and incentives

■ Systematic clinical care

■ Staff and systems to support coordination

■ Shared records

■ Shared quality governance arrangements between participants

■ Payment mechanisms that support these arrangements

■ The development of a workforce with new skills including the ability to manage multiple morbidity including dementia and work in multidisciplinary teams

Prerequisites for an integrated system

Integration.

Kaiser Permanente: Coordinating care in every setting.


Patients as partners:

Patients are no longer passive recipients and new systems and ways of working are required to

manage this change.

It has taken a decade for us to realize that better care is usually less expensive care.

It will take another decade for us to realize that patients are partners – either creating or compromising value.

Techniques that allow patients to create more value include: shared decision making; Al Mulley’s ‘preference misdiagnosis’;

amplified patient voice; informed care and (internet) coaching.

End of life care and chronic care are the most important immediate areas to create better value.

Tools that patients need to control and secure better value include: pathways, records, decision aids, social networks and

technology e.g. PatientsLikeMe.


From God to Guide – ParkinsonNet:

5 design criteria:

Helping to create an active patient able to manage their care and take key decisions

Defining what value based care would look like from the perspective of the patient

Changing the way that doctors and other clinicians work with patients by shifting to a

partnership approach with patients

Creating a network of experts

Linking all of these together with information technology tools

Bas Bloem created ParkinsonNet: a revolutionary partnership approach involving Parkinson’s patients in the Netherlands, has led to a 50% reduction in associated hip fractures and €20 million worth of savings.


High growth countries.

‘Something to teach, something to learn’’ isn’t a new form of Western Imperialism.

High growth countries and emerging markets can be characterised by 3 words: speed, buzz and leapfrog.

Many still have under-developed primary care platforms but entrepreneurs see this as ‘white space’.

Much greater reliance on technology, smart operational processes and public-private partnerships.

Growing middle class with increase in NCDs demands leap-frog over 20th century care models.

Asia, Africa and South-America all developing low-cost delivery models and point-of-care diagnostics. Reverse innovation.


Need to transact and transform and move from volume to value.

All parties need to agree and be brave enough to chart a 5-10 year vision.

Targets are not an end; they are means to an end.

Leadership is key:


Leaders in Rome identified 10 characteristics:

1

2

3

4

5

6

7

8

9

10

Enduring Values

Shared purpose

Consistent and stable leadership

Deep engagement with clinical staff

Strong focus on front-line

Set culture, hold professionals to account

Align individual, team and organisational objectives

Information transparency – internal and external

Curiosity about high performance

Authentic partnership


Final thoughts – Nurses lead pathways better than most

There are more similarities than differences in global health.

The future is with us, it is just unevenly distributed.

Most people believe that health systems need fundamental change but believe that change starts with someone else.

Be the change you want to see (Ghandi).

Lets get started on the 1%, 3% and 5% integrate and coordinate and help patients move from volume to value.

Launched at Davos...

Necessity: the mother of innovation

Low-cost, high-quality healthcare

This document is CONFIDENTIAL and its circulation and use are RESTRICTED. © 2013 KPMG LLP, a UK limited liability partnership, is a subsidiary of KPMG Europe LLP and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative, a Swiss entity. All rights reserved. Printed in the United Kingdom.

The KPMG name, logo and ‘cutting through complexity’ are registered trademarks or trademarks of KPMG International Cooperative (KPMG International).

something to teach, something to learn. dr mark britnell chairman and partner global health practice...

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